First quarter sales for the year 2007-2008 are 68.5 million Euros
• Weakness in short term demand and unfavourable exchange lead to a decrease of 20% year on year
• Cautious guidance confirmed for the full year
Bernin, France, 16th July 2007 – Soitec, leader in SOI (Silicon on Insulator) wafer material today announced total first quarter sales, as expected, of 68.5 million Euros. This represents a reduction compared to the prior year of 20% that includes an unfavourable exchange rate movement of 7.6%.
Wafer sales were lower in performance by 13.7% ( 19.7% in Euros).
| Sales (Euros millions) | 2007-2008 | 2006-2007 | Change |
| First Quarter | 68.5 | 85.7 | -20.0% |
Weak demand from major customers
Wafer sales were 66.0 million Euros in total for the quarter. The overall reduction in performance of 13.7% ( 19.7% in Euros ) year on year is split between 300mm down 16.6% ( 22.9% in Euros ) and other wafer sizes down by 7.8% ( 13.1% in Euros ). The 300mm performance reflects the fact that the supply chain continued to absorb excess inventories held by its main customers throughout the first quarter principally in the game console market and microprocessors as mentioned earlier this year.
Sales in the quarter from Picogiga International, Tracit Technologies and royalties totalled 2.5 million Euros.
Caution reiterated with regard to activity for the full year
Taking into account the sequential recovery in the second quarter that is in line with information currently available, the Group anticipates that the first half of the financial year 2007-2008 will be below the previous year by around 15% in performance (which translates into around 20% in absolute terms at the first quarter Dollar exchange rate). New products launched by main customers come on stream in the second half of the year but given the current uncertainty with regard to the timing of the ramp up in volume of these products, the Group cannot exclude that full year sales may be below the prior year. Lower levels of demand combined with the weak Dollar exchange rate will significantly impact this year’s margins particularly in the first six months. The Group confirms its commitment to implement all possible measures to reduce costs without impacting future prospects for the continuing industry adoption of Smart Cut™ based advanced materials, notably the implementation of the new plant in Singapore.
Recent development
The Group was pleased to note that the European Commission has announced its decision in favour of a research programme referred to as Benin 2010 and which is complimentary to the NanoSmart™ initiative. This 3-year programme managed in collaboration with the CEA and costing in total around 60 million Euros is devoted to the development of advanced new substrates. Soitec will receive, in total, direct aid of 12.25 million Euros with contributions coming from local and national funds.
Agenda
Q2 sales for 2007-2008 will be published on 15th October 2007 after the close of the Paris Stock Exchange.
About the Soitec Group: The Soitec Group is the world’s leading innovator and provider of the engineered substrates that serve as the foundation for today’s most advanced electronic products and nanotechnologies. Headquartered in Bernin, France, the company manufactures its comprehensive portfolio of engineered substrates, including silicon-on-insulator (SOI) and strained SOI (sSOI), using Soitec’s proprietary Smart Cut™ technology—the de facto industry standard. With its strong global presence, patented technology and industry-leading production capacity, Soitec is helping to drive the performance and power advantages that are key to the smaller, more power-efficient, and increasingly mobile electronic products favored by consumers worldwide. Both shares and the convertible bond are listed on Euronext Paris.
*SOI = Silicon On Insulator and sSOI = strained Silicon On Insulator
Smart Cut and UNIBOND are trademarks of S.O.I. TEC Silicon On Insulator Technologies.
For further information, please contact:
Iain Murray
CFO
Tel: +33 4 76 92 75 14
Email: investors@soitec.fr
Olivier Brice
Investor Relations – Financial Communication
Tel: +33 4 76 92 93 80
Email: olivier.brice@soitec.fr